Store chains look to green roofs

Tax incentive spurs more solar panels

Retailers are typically obsessed with what to put under their roofs, not on them. Yet the nation's biggest store chains are coming to see their immense, flat roofs as an untapped resource.

In recent months, chains including Wal-Mart Stores, Kohl's, Safeway and Whole Foods Market have installed solar panels on roofs of their stores to generate electricity on a large scale.

One reason is that they are racing to beat a Dec. 31 deadline to gain tax advantages for these projects. So far, most chains have outfitted fewer than 10 percent of their stores.

Over the long run, assuming Congress renews a favorable tax provision and more states offer incentives, the chains promise a solar construction program that would ultimately put panels atop almost every big store in the country.

The trend, while not entirely new, is accelerating as the chains seize a chance to bolster their environmental credentials by cutting back on their use of electricity from coal.

"It's very clear that green energy is now front and center in the minds of the business sector," said Daniel M. Kammen, an energy expert at the University of California, Berkeley. In the coming months, 85 Kohl's stores will get solar panels, while 43 already have them. "We want to keep pushing as many as we possibly can," said Ken Bonning, executive vice president for logistics at Kohl's.

Macy's, which has solar panels atop 18 stores, plans to install them on another 40 by the end of this year. Safeway is aiming to put panels atop 23 stores. And other chains - including Whole Foods Market, BJ's Wholesale Club and REI, the purveyor of outdoor goods - are planning projects of their own.

Wal-Mart, the nation's largest retailer, has 17 stores and distribution centers with solar panels in operation or in the testing phase. It plans to add them soon to five more stores. People at the chain are considering a far larger program that would put panels and other renewable technologies at hundreds of stores.

"It's going to be the Wal-Marts of the world that will buy these things over acres and make a difference," said Roger G. Little, chairman and chief executive of the Spire Corp., a Boston company that provides solar equipment.

Analysts are not sure how much power the rooftop projects could ultimately produce, but they say it could be enough to help shave total electricity demand. In many communities, stores are among the biggest energy users. Depending on location and weather, the solar panels generate 10 percent to 40 percent of the power a store needs.

Booming demand in recent years has driven up the price of solar panels, and analysts say it costs far more to generate electricity from solar energy than from coal.

Coal generation costs about 6 cents for a kilowatt hour, which is enough electricity to run a hair dryer for an hour. Natural gas generation costs about 9 cents a kilowatt hour, said Reese Tisdale, a senior analyst with the consulting firm Emerging Energy Research. In comparison, "best case" for power from solar panels is about 25 to 30 cents a kilowatt hour, he said.

But retailers believe that they can achieve economies of scale. With coal and electricity prices rising, they are also betting that solar power will become more competitive, especially if new policies addressing global warming limit the emissions from coal plants.

Retailers are fast becoming energy experts. They are experimenting with traditional solar panels, a new type of thin solar panel and ground-mounted tracking systems that move with the sun. They are also combining those systems with other rooftop technologies like skylights and solar water heaters.

American retailers are following the lead of stores in Europe, which are much further along. Store-roof projects are so numerous in parts of Germany that they can be spotted in satellite photos. Government subsidies there, however, have lasted for years.

Retailers are also looking at other ways to extend their use of renewable energy by testing technologies like wind turbines and reflective white roofs, which keep buildings cooler in warm weather.